and shocking news from british police. they have been given new information about the death of princess diana, the latest on what we know coming up at 3:0 eastern time. from the american dream to america's reality. millions still feel like they are missing out on the recovery. so when will it be their turn? christine romans has answers. "your money" starts now. the american dream, happiness and prosperity. a house, a great job, maybe a couple of kids and time to enjoy it all. the great recession is behind us, but the recovery isn't so great. i'm christine romans and this is "your money." first, housing. goldman sachs says all cash deals are half the market right now. wealthy investors, buyers from china, canada, south america, pumping up recent housing data. average americans may be getting priced out. in the second quarter, when you look at this, more than two-thirds of all the homes sold in the u.s. were affordable.

for families making $56,000 a year, that's the median u.s. income. but you can see how that affordability is falling. next, the labor market. nearly 5 million net new jobs have been created near the end of the recession four years ago, but look at the jobs that were lost. mostly middle wage jobs right here, and the jobs we're creating, mostly lower wage positions. and finally, cute but costly. children. for a middle-income family is costs $241,000 to raise a child. that's from birth to age 18. that cost has surged 23% adjusted for inflation and includes things like housing, food, health care, as well as toys and computers. those of you in the northeast are probably going to pay even more of that. out west, more than that average. america's rural areas getting a little bit more of a break. mark morial is the ceo of a

company yielding nearly $2 trillion in assets. what's the biggest thing holding americans back from this recovery today? >> good jobs that pay good wages, number one. number two, the ability of people to restore their damaged credit, therefore, they can borrow again for a home. and i think thirdly, the idea that a young person who even earns a college degree is having a tough time finding a job in their chosen field of study. the american dream has been wounded, and we've got to rebuild it. >> you know, mohammad molarian, you know markets and you know the economy, and i was watching retail earnings this week showing from store to store, that a paycheck to paycheck customer is under stress right now. sales at macy's declined for the first time in four years. interestingly enough, bloomingdale's also boind maown macy's did fine.

costco having to hold up. >> there are a group of many people who are worried about their jobs if they have jobs. they're not well-paid jobs, they can't own their home, and in addition, they don't feel like they have adequate provision and access of public services, education and health. and that is particularly true for the long-term unemployed, for the younger unemployed, and it's particularly true for those below the poverty line. on the other hand, we have a group of people that are better off. they have done extremely well. why? because they have asseccess to family assets. and family assets have been bolstered in an attempt to improve financial accuracy. you're not getting enough growth, you're not getting enough job creation, and it's

not an engineering problem. that's what's most frustrating, christine, it's not an engineering problem, it's a political problem that has to do with incredible polarization in washington. >> so it's a washington problem. do you think the economy would be doing better if washington had its act together a little more. part-time jobs, low-wage jobs, temporary service sector jobs. one economist described this to me as a bartender economy. is that what a recovery is supposed to look like, and can we keep a middle class strong and america the driver for the world if these are the kinds of jobs we're creating? >> no, that's not how the recovery should look like, and we are capable of so much more. and it's not just about the here and now, it's also about the fact that most americans feel for the first time that their kids' generation will be worse off than theirs. so two things that need to happen. one is at the macro level, washington needs to act on the three problems we have:

insufficient demand, insufficient structure reforms, and we have to remove some debt issues. then at the micro level, we have to empower and enable incredible tale talent, and this is about retoor retooling and retraining. >> mark, i know you want to jump in there. last word for you. >> this is a long-term trend. the loss of good-paying jobs was accelerated by the recession, but it began a long time ago with our trade and fiscal policies which ince nerknted thd jobs. it puts a premium on good jobs. if the congress wanted to do something in the short run, raise the minimum wage. make a down payment on the idea that people who work need to earn a decent and living wage. so there are political issues, but i think we need the public and private sectors to come together on a long-term economic plan for the country.

we have to do it because what we see now is that the recovery is less than even. and it's leaving many, many people behind, and these are warning signs for the future of this nation. >> i think we'll be hearing more about quality and quantity in the jobs market and what that's going to mean for working americans, paycheck-to-paycheck americans and building the middle class. thank you very much, both of you. talk to you again soon. >> thank you, christine. coming up, the u.s. makes up 5% of the world's population but 25% of its prison population. what that means for our economy and your money, next. and no calorie options. that's why on vending machines, we're making it easy for people to know how many calories are in their favorite beverages, before they choose. and we're offering more low calorie options, including over 70 in our innovative coca-cola free-style dispensers. working with our beverage industry and restaurant partners, we're helping provide choices that make sense for everyone.

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hd crime pays, at least if you're in the prison business. the number of people locked up in the u.s. has quadrupled since 1980. the number of privately owned prisons has skyrocketed as well. critics point to the high level of low level drug offenders in

the world. they want to tweak the punishment of the drug offenders. it may be doing more harm than good. >> this criminality and incarceration krip -- cripples many americans. >> studies show blacks are put in prison longer than those performing civil crimes. >> i think you almost have to be blind to america and not realize that we still have very, very deep elements that go all the way back to slavery and segregation, and they go all the way back to fundamental differences in neighborhoods and in cultures. and i think it would be very healthy for the country and for

the congress to re-evaluate both the criminal justice part but also to re-evaluate the whole way we've dealt with prison and the way in which we've basically created graduate schools for criminality and locking people up in ways that are increasing their inability to function in society. >> graduate schools for criminality. a recent national bureau of economic research study found that juvenile incarceration leads to lower high school graduation rates and higher chances of adult incarceration down the road. ashleigh banfield is the leader of pay per view. now the media manager for the drug policy alliance, a group. they delivered 400 ounces of cocaine. it's a crime, nobody denies that. but did you have an idea that you would spend more than a

decade in prison for that crime? >> no, i didn't. it was an awakening. i walked into a living nightmare, made a first-time non-violent drug sale. a bowling buddy asked if i wanted to make a fast $500 delivering an envelope pto mt. vernon from the bronx. at first i said no. but i got desperate and when you get desperate you do stupid things. i delivered the envelope and walked into a police sting operation. 25 cops surrounded me and i was sentenced to 15 years to life and the mandatory drug sentencing mandates maximum sentencing laws. >> if you're eric holder, you're looking at $80 billion spent on prisons every year. one year of youth jail, $88,000. the cost of public school,

$110,000. ashleigh, did you see any dissenters to eric's proposals? >> you would expect a cacophony. eric holder said stop writing in the amounts, that way we can skirt the mandatory minimums. but he didn't go to the legislative process to say let's rewrite these policies. this is really a bipartisan thing, christine. everybody knows we are in crisis. we're bursting at the seam s wih our crisis. anyone less, christine romans, should think there are dangerous drug offenders who will be released out in the streets to attack our children. that's not what the policy is about, either. you can't be violent, you can't have used a weapon, you can't have assaulted children, and you can't have connections to drug cartels or gangs or that sort of thing. so being specific, you would not

apply in this case. you would be one of the people spared one of those very long sentences. >> let's talk, anthony, about what newt gingrich said in that clip we just played, that prisons are graduation for criminals, they increase the number of people unable to exist in society. how do prisons need to change so they do more rehabilitation and less punishment, especially for what you're talking about, non-violent drug offenders who still have committed a crime will have to face punishment, but what do you do over those years you're in prison? >> to be sentenced to 15 years to life is unbelievable. i was lucky, i acquired three college degrees while in prison. i have a master's degree from the theological seminary. so education to me was a way to get through prison. so i would say education is one way to do it. and have prisons, instead of pure punishment, make them rehabilitative centers where people can find their real self

because prison is the most existential environment there is. you discover who you are. so if you have these rehabilitative programs available, you can take advantage of it. >> i think that's a good way of putting it. i would not think about it as a 6x9 cell. the war on drugs has been about punishing and deterring. have we failed? have we succeeded? >> i think we failed in a lot of places. you, i think, are an exception to the rule, anthony. i don't think a lot of people get a degree. i don't think they get a master's degree, that's for sure. i think they come out with alarming recidivism rates in this country. you can watch the programs on television that show the gang-related activity, the segregation that exists in these societies, because they are their own societies, and they're not rehabilitation for the most part. yes, there are exceptions to the rule, but for a lot of people,

that's hard to get that passed in congress. let's spend more money on the people in prison. >> your first job is the job that is going to propel you for the rest of your life, for your economic life, for your family. i cover family economics. that first step going to prison for young people, you have just derailed it and it is so, so deadly. anthony, thanks for joining us. >>ashleigh, good to see you. today gun permits are soaring in the very town where 26 children and six teachers were gunned down. what's going on in the wake of the massacre? you're watching "your money." [ male announcer ] how do you get your bounce?

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late last year the massacre at sandy hook elementary in newtown, connecticut shocked america and sparked a new debate about gun rights. but in newtown, you might not expect something that happened.

poppy harlow joins us. poppy? >> reporter: this is pretty surprising to me, but what we've seen, in the months following the massacre at sandy hook elementary school, the purchase of weapons have risen. the number of background checks for people who want to buy guns rose 53% from the six months before the shooting to the six months after. >> i'm nancy. >> hi. >> how you doing? >> reporter: she's a grandmother who is about to become a first-time gun owner. >> this way is easier. >> reporter: nancy ellis says the new gun laws passed in connecticut, among the toughest in the country, are a big reason why she's buying her first firearm. >> our rights are being slowly infringed upon, and that this whole idea of controlling guns has come to my back door. in other words, there could be a time when i may never be able to get a firearm. >> reporter: ellis lived in newtown for 28 years. her desire to own a gun is part

of a spike in the state. newtown viv newtown, vividly remembered for one of the worst gun massacres in u.s. history, are on track this year to double the amount of pistol permits it issued last year. >> i'm concerned that it can get out of hand. nancy lanza had quite an arsenal, i understand, in her home. you only have two hands. how many guns can you fire at once? >> reporter: dave ackert and france are on the gun alliance. >> there is a perception that it will not allow them to purchase certain guns. >> reporter: this newtown resident owns several guns but did not want to show them on camera out of respect for the victims of the shooting. >> you went out and bought more guns. why? >> that was driven by 100% the petition that was trying to be

passed. it's my job to take care of my family. >> reporter: it's hard for jim russo to understand, as he grieves the loss of his daughter lauren, killed at sandy hook. >> it hurts in a different way. my daughter was in the dream just about a week ago. and i said, lauren is dead. how can she be there? she's dead. >> reporter: what do you think when you see these numbers? >> it's sad. it's really sad. there is no other words to say. it makes me sad to think that people -- they feel that they're protecting themselves, but they're just adding to the problem. >> reporter: there was also a surge in gun sales in coloradou theater massacre. and following the shooting in tucson, gun purchases in arizona spiked. while nancy ellis grieves for the victims of the tragedy in her own backyard -- >> my heart breaks for them. it truly does. >> reporter: -- for her, this is about protecting her rights.

>> did the guns cause the tragedy? no. it is the person behind the gun that caused the tragedy. >> reporter: and here's something i think is really important to point out, christine. when you look at the number of guns, the number of americans that own guns in this country has been declining steadily, really, since the '70s. but what we're seeing is more guns in the hands of fewer people. and that's a key point that two of those men in the piece talked to me about that are part of newtown action alliance. that's what really concerns them. they're not anti-gun per se, they're concerned about seeing more and more guns, what they see as sort of a stockpiling of guns in the hands of fewer people, and as you saw, they mentioned nancy lanza in that ho home. >> a major airline merger, a legal battle brewing. is the price for your next flight about to soar?

storm you' . you're grounded. that's the message from u.s. airways. the merger would make the biggest airline. by in 1978, there were 18 airlines, and now there are just 12. if this merger goes through, those four airlines will control more than 80% of the u.s. travel market. this is the chart the airline industry wants you to see. it's the cost of flying. the cost of flying has actually dropped over those 30 years, although prices have ticked up a little bit in the last decade. here's a chart they don't want you to see. in 2010, jetblue and american airlines made a deal, which gave jetblue slots at reagan

international airport. before jetblue landed at reagan, us airways charged $1200 a ticket. after they landed at reagan, they dropped to $500. reduced competition has allowed them to raise fares and charge you more for things like checking your bag or changing your ticket. the u.s. airways president said, quote, consolidation has also allowed the industry to do things like ancillary revenues. this is a structured permanent change in the industry and one that's impossible to overstate the benefit from it. when i think about ancillary revenues, i think about paying for snacks and headphones on the airways. move over, america, china

needs more fuel. china set to become the biggest importer of oil later this year as the u.s. pro duduces more ofs own. the economy grew by 3.4% in the second quarter. that's the most growth since 2011. paula deen might be winning in court but she's not winning her empire back. after losing in court to saying a racial slur, she lost contracts from food network and target and others. it trails behind several other developed countries. will you still look the way you looked without george zimmer? the company dropped zimmer in a very public feud. another ad from j.c. penney has moms up in arms. parents say it promotes bullying

because it features a kid eating alone thanks to the clothes he's wearing. that's it for "your money." we're here fridays and saturdays at 2:00 p.m. eastern and we're back monday at 3:00. have a great day. welcome to "the next list." i'm dr. sanjay gupta. this week you'll meet innovators pushing the boundaries on what's possible in science. taylor wilson is a physics prodigy who dreams about solving the world's energy problems, fighting nuclear terrorism and bringing cutting edge cancer treatments to the furthest edge t